Key Takeaways
- • Bitcoin fell as much as 1.4% to below $79,300 before recovering to around $80,200 in early London trading, according to Bloomberg, with Ether, XRP and Solana also weakening.
- • US-listed spot Bitcoin ETFs recorded $772.4m in net withdrawals on Thursday and Friday, reversing more than $1bn of inflows earlier in the same week.
- • Pratik Kala, portfolio manager at Apollo Crypto, said Bitcoin remains firmly in the risk-off category for many systematic funds and algorithmic trading strategies, leaving it exposed to further selling.
- • Pressure stems from concerns over debt-funded AI infrastructure spending, the upcoming Federal Reserve policy decision and the US midterm elections, with investors awaiting big tech earnings.
Summary
Bitcoin slipped below $80,000 as concerns over the AI investment boom and uncertainty ahead of the Federal Reserve's next policy decision weighed on risk assets, according to a Bloomberg report. The world's largest cryptocurrency declined as much as 1.4% to below $79,300 before recovering to around $80,200 in early London trading. Ether, XRP and Solana also weakened as investors reduced exposure to digital assets.
The selloff followed $772.4m in net withdrawals from US-listed spot Bitcoin exchange-traded funds on Thursday and Friday, which reversed more than $1bn of inflows recorded earlier in the week. The flows point to a shift in positioning among institutional and fund-based holders of digital assets.
Pratik Kala, portfolio manager at Apollo Crypto, said Bitcoin remains firmly within the risk-off category for many systematic funds and algorithmic trading strategies. That classification leaves the asset exposed to further selling if broader market sentiment deteriorates. Kala also flagged growing concerns over the potential security implications of advances in AI for cryptocurrencies, as well as speculation about consolidation in the technology sector.
The pullback comes amid mounting concerns over debt-funded AI infrastructure spending. Investors are awaiting earnings from major US technology companies for indications of whether investment in the sector can sustain current valuations. Caroline Mauron, co-founder of Orbit Markets, said Bitcoin had remained relatively resilient despite AI-related debt weighing on other risk assets, but that attention was shifting toward the Federal Reserve's policy meeting and the upcoming US midterm elections.
The latest decline leaves Bitcoin struggling to establish a sustained recovery above $80,000, as macroeconomic uncertainty and weakening appetite for speculative assets continue to shape positioning across digital asset markets.
The selloff followed $772.4m in net withdrawals from US-listed spot Bitcoin exchange-traded funds on Thursday and Friday, which reversed more than $1bn of inflows recorded earlier in the week. The flows point to a shift in positioning among institutional and fund-based holders of digital assets.
Pratik Kala, portfolio manager at Apollo Crypto, said Bitcoin remains firmly within the risk-off category for many systematic funds and algorithmic trading strategies. That classification leaves the asset exposed to further selling if broader market sentiment deteriorates. Kala also flagged growing concerns over the potential security implications of advances in AI for cryptocurrencies, as well as speculation about consolidation in the technology sector.
The pullback comes amid mounting concerns over debt-funded AI infrastructure spending. Investors are awaiting earnings from major US technology companies for indications of whether investment in the sector can sustain current valuations. Caroline Mauron, co-founder of Orbit Markets, said Bitcoin had remained relatively resilient despite AI-related debt weighing on other risk assets, but that attention was shifting toward the Federal Reserve's policy meeting and the upcoming US midterm elections.
The latest decline leaves Bitcoin struggling to establish a sustained recovery above $80,000, as macroeconomic uncertainty and weakening appetite for speculative assets continue to shape positioning across digital asset markets.
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